The Andres Lopez Law Firm

What is a qui tam lawsuit?

Many businesses in Southern Florida may have the federal or state governments, or an agency thereof, as a client or a business affiliate. After all, much of the government's work is done through contracts with private businesses. Not surprisingly, it is very important for a business in Coral Springs who is doing business with the government to take great care to pay attention to accuracy and detail at all stages in their dealings with the state. Otherwise, the business may find itself on the receiving end of an accusation that it defrauded or misled the government.

Furthermore, the government itself need not investigate all such allegations directly. In the case of false claims against the government, private individuals, including business rivals, can file suit on behalf of the federal government in what is called a qui tam action.

To some extent, qui tam works just like other business litigation actions. In the case of false claims, if a plaintiff prevails, then the court will award up to three times the amount of actual damages, attorney fees and costs and up to $10,000 in penalties as a consequence for each false claim a business made.

It is important to remember that a false claim does not just cover cases of flagrant fraud. Padding a bill or even in some cases providing a substandard product can also lead to a qui tam suit.

However, one difference is that, before filing, a person contemplating the qui tam must give 60 days of notice to the government. The federal government can then either join in the lawsuit or decline to do so, giving the private individual the right to prosecute. At the end of the suit, the individual who filed is entitled to a percentage of the recovery.

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